Wairarapa Times-Age SATURDAY, JULY 24, 1943. DEVIOUS TAXATION METHODS.

Wairarapa Times-Age, 24 July 1943, Page 2

Wairarapa Times-Age SATURDAY, JULY 24, 1943. DEVIOUS TAXATION METHODS.

♦ . JX an opening' debate in the House of Representatives on Thursday on the Land and Income Tax (Annual) Bill—a measure submitted as one that made no increase in the rates of income and land taxes, but merely reimposed last year’s rates —an Opposition member (Mr Goosman) dealt, amongst other things, with the desirability of using plain and straightforward methods in imposing taxation. This is a question well worth raising, for there are aspects of our present taxation laws which could hardly be improved upon if their intention were to make it as difficult as possible for the average taxpayer to understand what his liabilities are. As an example of methods that should be avoided, Mr Goosman instanced a long clause in the Finance Bill. No. 2 passed last year, described as a clause amending the basic rate of income tax. Because of the cumbersome and complex way in which the clause had been framed, Mr Goosman said, he doubted if anyone in the House, including the Minister in charge of the Bill, had understood it. An assurance had been given at the time that the clause contained no increase in taxation, but its effect was to make assessable income that had been non-assessable. Whatever the merits of this particular example may be, there is no doubt that the Taxation Department is addicted to needlessly involved and tortuous methods. What is needed, and what should be insisted upon by Parliament and by the body of taxpayers, is a plain statement in the simplest possible terms of the rates of taxation payable on various grades of income and of what does and does not constitute assessable income. Most decidedly, too, a clear and complete explanation should always be given of any change proposed in legislation in either the rates or the assessable basis of taxation. An abuse which should be ended is that of making liable to income tax income that has already been taken by the State in taxation. It may perhaps be legitimate to levy income tax on Social Security payments, on the ground that these payments are not taxation but contributions made with a view to obtaining benefits. There can be no justification’ however, for levying income taxation on amounts paid (at the rate of Is Gd in the pound) in National Security taxation. This procedure can only be ascribed to a desire to make the actual rate of taxation appear to be appreciably lower than it really is. In time of war it is of course necessary that taxation should be at a very high level. Serious thought and attention might wisely be given, however, to an overhaul of taxing methods, with a view to making them as frank, simple and straightforward as possible and to cutting out drastically all that is tortuous and needlessly complex in the procedure at present in vogue.